Buying a house with parents

 I am considering participating in a new program my employer has to buy a
home in my employer's area with financial assistance on their part.
Unfortunately, the homes I could afford are real fixer uppers and the
neighborhood is high crime. I am single (but that might change one day).
I have no kids. I live in a small apartment in a suburban area now. I
also want to live in larger quarters very much.

My folks are dead set against my idea because of high crime in the area
I am considering. My parents made me an offer that's tough to refuse. My
dad's 81. My mom's 69. I am 46. They want to essentially put down what
would contribute a large down payment toward of the cost of a house, put
it in my name, and we would share it. I would make the mortgage
payments. We would share utilities.

My parents offered to sell their modest row house and use it and a large
investment that comes due in 2008 for this purpose. My job is good and
my FICO score is high, so making the mortgage payments is not a problem
for a house my folks and I would want in the area my parents have in
mind.

This deal works out in my parents' favor because they have a large fund
that's due to pay off in a few months and they would live in a nicer
neighborhood and a nicer home. When my dad (who I expect to outlive my
mom) needs nursing care, we will have the means to provide it in-house.
My dad has met with his financial advisor, and this is the idea they
came up with.

My mom also desperately wants to move because she's tired of living in a
row house. My dad also thinks the neighborhood where they live now is on
the decline so they both want to move to a nicer neighborhood.

So the idea is that they would "do whatever it takes" (quoting my dad)
to get me into a nice house in a safe neighborhood next year, but that
we would buy a house that's large enough to have my parents and I live
there, but in separate spaces (like an in-law suite). My dad will do the
preliminary shopping for the house. My parents also want to have final
approval of the home and the neighborhood. I can live with those
conditions.

My dad is a home builder by trade and he did certified home inspections
part time, so he's more than qualified to shop for houses. I would have
a lot of input into the decision, of course. Another down side is, it
would increase my commute to work, but it would be tolerable, around 45
minutes each way. My daily commute now is around 20 minutes.

I have been living outside my parents' house since age 21, which is more
than half my life. I was sick a few years ago and I stayed with my
parents for tree weeks to recover, at doctor's orders. During that time,
we got along fine.

I have one younger sister. Knowing my parents, they discussed this idea
with my sister and her husband before telling me about it. She and her
husband were there when my parents proposed this idea to me. They are
fine with it. They said they are not concerned with my parents giving me
this money and that when the time comes, we can make a deal if my
parents have any money left over in their estate. My sister,
brother-in-law, and I are very close, so no rivalry there and they both
are professionals with a good income.

The question I have, is sharing a house with my parents a good idea from
an emotional standpoint for the three of us? Has anyone done this? My
sister's a practicing clinical psychologist. My dad made this proposal a
few days ago, so I haven't had time to talk with my sister about it
privately. I imagine she would have said something if she thought it was
a bad idea (she's very vocal and opinionated). I plan to talk with her
about it, but she was not available when I called last night.

So what would you do in tis situation?

 
Nobody can really answer this for you.

One thing I will say is that the three of you should agree on the
financial arrangements (including what happens when anyone dies), and
visit a lawyer before anyone signs papers on a house. Money is the
root of many bitter family disputes, so you want to make sure that
everyone has the same understanding and there are no surprises.

The lawyer should make sure that everyone understands and agrees what
will happen, and she should draw up papers for all three of you to
sign. Yes, it will cost a few hundred dollars, but that's nothing
compared to the cost of a house or to the cost of a bitter family
war.

--
Stan Brown, Oak Road Systems, Tompkins County, New York, USA
                                  http://OakRoadSystems.com/
"If there's one thing I know, it's men. I ought to: it's
been my life work."  -- Marie Dressler, in /Dinner at Eight/

 

I agree that legal review is essential, but my dad's luke warm on that
idea. Fortunately, one of my cousins is an attorney who was a real
estate agent before she went to law school. I know she would be offended
if we did not enlist her services. This cousin has reviewed every real
estate transaction that's occurred in my family, so I don't see why this
would be any different. She does this for free, but I will insist on
taking her and her husband out somewhere nice for dinner to thank her.

 says...

How close is your cousin to your parents?

You really need a *disinterested* (as in, no interest either way) lawyer.
Insist on it.  If your parents kick up any more fuss about it, consider that a
solid warning that they would be difficult to deal with on a day to day basis if
you go ahead.

Also, consider that some of the motivation for this is to have you be a
caretaker in their declining years.  With you sharing quarters day to day you
inevitably will be the primary person involved.  Consider further that this may
be a reason your sister is so quick to endorse the deal.  This all may be fine
with you  or even something you may feel honored to do.  But you need to think
ahead and be aware.

Like someone else said, only you can answer these questions.  On paper, it makes
all the sense in the world.  To live it out depends on your whole family
dynamic.  But the legal part of it - do it, and hire someone totally outside the
situation for it.

Banty

 Banty wrote:

I completely agree with everyone else. NO NO NO!

In fact, there should be a rule that parents and grown kids
  live 50 miles apart.  Too far to visit every day, but
close enough to visit on the weekend.  Many good
relationships have been ruined by a little parental
meddling.  But a jealous friend can be more dangerous ;-)

Caregiver, unless you are trained for the job, is a real
killer too.  I think each year is equal to 10 years of heavy
smoking.  You can't predict the future, but you can prepare
for eventualities.

What neighborhood ~isn't~ becoming a ~bad~ neighborhood
these days?  Previous post about gang bangers is true.  But
a drug infested neighborhood is a real risk, since they
always need drug money and live in a haze far from reality.

Grow to be all you can be and stay the best of friends with
your parents.  Remember the ole saying "Green and growing,
or ripe and rotting"

-- larry / dallas